All right. I think to respect everybody's time, it is now 5:30 P.M. Eastern. Let us get started. Let me jump in. Greetings, and welcome to the Draganfly Q2 2022 earnings call. Though the markets continue to be challenged, our Q2 results show that we continue to strengthen and grow. Once again, my name is Rolly Bustos, and I am Internal Investor Relations here at Draganfly. I personally welcome each and every shareholder, stakeholder, and analyst here today. Today's call will follow the same format as previous ones, which means it will start with our CEO and President, Cameron Chell, discussing second quarter operational highlights. From there, our CFO, Paul Sun, will jump in and discuss the financials as reported earlier this afternoon. We will then conclude with our Lead Director, Scott Larson, facilitating the Q&A portion. Remember, you are always welcome to reach out to me at investor.relations@draganfly.com.
Lastly, I want to remind everyone that this presentation may include forward-looking information and statements. These statements are not guarantees of future performance, and undue reliance should not be placed on them. Any future events or financial results may differ from what might be discussed here. The full forward-looking disclaimer can be found on page two of the presentation, and I would be happy to send that to anybody upon request. Without further hesitation, Cam, please go ahead.
Thanks, Rolly. Thanks everyone for joining us today. Thanks in particular to the incredible team that we have at Draganfly, and for the work that you have done in this last quarter. Especially thank you to our shareholders, stakeholders, who have had trust with us, believe in us, and are on this journey to create the number one or the number two drone solutions company, in North America. Not to take away the good news from Paul Sun as he reveals and runs through the financials, but we are very happy as a team to report that we have had another record quarter. I think this is probably about number five in a row, and we continue to see growth in the manner that we really like to see growth. We are, and we did complete, and we are reporting CAD 2.37 million of revenue in Q2.
This represents a 19.6%, almost 20% increase year-over-year, and most importantly, that is 100% organic growth. That is customers that are coming to Draganfly for the products and services that we are designing and scaling out for them. That is really at the core of our strategy, is that the IP and the solutions that we design are the core solutions that our customers are wanting, and that we are growing that base. That is what we believe will create long-term sustainability in the business. I will let Paul run through the details of that, and after the presentation, we also look forward to answering the questions that you have sent in ahead of time. I am just going to pull up a share screen here. We have got the customary disclaimer, and of course, Rolly, gave us all notice of the potential forward-looking statements.
Just to be clear, and it is really important as we put our financials in context, where we strategically believe the industry is, and why we are conducting our strategy in the way that we are conducting our strategy, which is somewhat different than maybe some other drone competitors out there, the routes that they are pursuing. First of all, the industry today is about a CAD 20 billion industry, and that industry is primarily, and it is really important to understand this, is primarily military. It is probably about 95% military, a couple of percent, 3%- 4% of consumer, and really only 1% or 2% is commercial. Listen, I have seen these industry projections for years, where they say, "Hey, it is going to grow to CAD 40 billion," like this projection does. I have never believed them.
The reason I have never believed these before is because we were one of the companies that were around, working in the commercial space in particular, and we were not seeing that kind of growth. We were having to fight for every single sale, every single deployment, every single service ticket, whatever it took. What we have seen since the FAA started to give, in particular, guidance around BVLOS, but other regulations as well, is we have seen the industry open up. Our issue right now is managing how we grow and the type of growth that we want to have, not fighting for those sales. We do see, and I for the first time believe these industry projections of going to CAD 40 billion or having the potential to go to CAD 40 billion by 2028. The constraining item there is not demand, which is really exciting.
The constraining item there is infrastructure, capacity, regulation, supply chain, the things to keep up to the demand. It is important to note that because when you take that longer term view, you end up designing and building services and products that are proprietary to you, and solutions that are proprietary to you so that you can not just make the sales now, but really create a moat around your strategic differentiators and the services that you will be providing in the future. The industry today still is highly fragmented. The commercial market in particular is at an inflection point, where it is where the majority of the growth is going to be happening. Things like AI, autonomy, and the sensors are more important than ever, and the things like we have very large segments coming into this now, like delivery, like services, that are big needle-moving opportunities.
They are not a matter of selling one or two CAD 30,000 or CAD 50,000 drone units. They are multimillion, multi-year opportunities, and those are the majority of the types of contracts that we are now working on. Our business model, just for review, and again, just to put our financials in context, really has four broad sections. We do contract engineering, and it is one of the reasons that we have been around so long, is that we have done a lot of contract engineering, in particular to the military contractors, the AeroVironments of the world, as an example, or the Raytheon-type companies. That contract engineering over the last 24 years has allowed us to build a really strong bench of engineers. While pretty much every other North American drone manufacturer has gone out of business in the last 20 years, right?
Not in the last two or three or four years since we've seen a number of upstarts start. I'm talking about the last 20, almost 25 years, where they've all gone out of business, and they all had hundreds of millions of dollars behind them. It's because they basically tried to build a commercial product, sell it into a consumer base, had no margin, and had to compete with Chinese or offshore-type manufacturers. The market is very different today, and one of the reasons that we're able to really garner the market, and be in a position to take advantage of the explosive growth that's about to unfold, is the fact that we have such a strong engineering bench that has been building military applications for over 20 years now. We also have a full product and development sales pipeline and lineup of products.
It's not like we're, hey, we're coming out with a new product, and we're going to get into a new industry, and it's going to develop, and we're going to get a signature customer. We've been developing new products for years. Just this last quarter, in some of the operational highlights that we'll talk about, is we just released three really exciting new products, which are absolutely going to be driving our growth through Q3, Q4, and beyond into next year. More on that in a minute. But the point is, we have a product line that's built out. It's not like something like, hey, we're trying to get that first customer or that first This thing is scaling. The scaling that we're doing right now, constraints are all around our ability to continue to increase our capacity, which we're doing as fast as we can.
We also have full flight services, and a lot of companies have divided themselves either into a manufacturer or into a service company. The reason that we do both, is because companies aren't coming to us looking for a drone that goes five minutes further or 500 ft higher. They're coming to us looking for solutions. They're coming to us, it might be a ports authority that are saying, "We need to do environmental monitoring. We need to do security. We need to do mapping and survey, and we need to have it in a comprehensive package that feeds into our ERP or into our IT." Again, at that point, it's not really a matter of which is the right drone. The question is, which is the right platform? At Draganfly, that's what we continue to build, is platforms for our customers in these segmented industries.
We do mapping, we do survey, we do data collection, and we do delivery as services, many of which we'll talk about in some of our operational highlights coming up here. The other area that's really important to us is our software, data, and AI. At the end of the day, the customers, again, aren't looking for a particular airframe. They're looking for a platform. But what they want at the end of that platform is a result. The result is say a package delivered or the data that comes from the mapping and the survey, or the mining survey, or the mine detection survey. They want the data.
Even as it relates to delivery, the data is so important, that when it was delivered, how it was delivered, what was the package weight, what was in the package being delivered, how long before they picked up. This is all incredibly important competitive intel. We are highly focused on our own kind of AWS services, if you will, where we actually fly flight services, design specialized sensors, have some of our own proprietary sensors and AI that provides data back to our customers that they cannot get anywhere else, much less from another company that might manufacture a drone. This is our long-term strategic objective. Five years from now, Draganfly, of course, will be known as a drone company.
But we are likely, in my opinion, going to be probably the largest data repository of forestry information in North America, maybe the largest repository of certain types of mining deposits in North America, and that is the data that becomes really valuable to our customers and so sticky. But that data is the most important asset of the company. They are not looking to get John and Jerry's flight service company to fly a mission, right? They are not looking for a particular drone to fly that mission. They are looking for us to provide them a comprehensive and reliable of their feel that we can say this with such confidence is that we have seen the market develop over 24 years. We have seen all the big competitors come in with the big private equity names and the big capital and the amazing management teams than they are.
A lot of them, they just have not seen all these cycles that they think are new, are just the same thing repeating themselves. At the end of the day, the drone industry really is about the data industry. Our full product and services here, you get a sense of it. We have got our Draganfly Commander, which has been an award-winning drone for years. We have launched our new Draganfly Medical Response Drone back in Q1. We actually started delivering those into Ukraine. An incredibly capable drone, totally unique in the industry. Temperature-managed box on top. Again, it is a solution. There are lots of drones or airframes you could put into that theater, but there are not a lot of drone solutions that can provide the delivery of insulin or antibiotics, or emergency medical equipment in a combat zone for humanitarian reasons.
That is the exact type of solution that is gaining traction with customers over in that region. Now we have search and rescue drones that are highly specialized. We have got fixed-wing drones that are highly specialized. We work with the Draganfly Quantix, which is actually an AeroVironment product that we have identified to work with, that we have modified and worked with for agriculture and for situational awareness or reconnaissance. But we are not afraid to use other platforms that are best suited for our customers. We have our long-range lidar, which we will talk about a little bit more, and our Commander 3 XL, which we will talk about shortly. We have full flight services.
In each one of these areas that you see listed here, we have something that is a strategic differentiator, something that is completely proprietary to what we do that differentiates us from somebody else that might be able to fly a mine detection mission, or a mining mission, or power line missions. The reason that we developed our own lidar system is for that exact reason. There are certain types of measurements and data that we can collect and apply AI to that other companies can't do that allow us to have a differentiator with our customers and provide them better data. Which speaks to the final piece of the equation here, which is our AI and data solutions. We're the only folks out there that actually have a camera system that can record things like vital signs, your heart rate, your respiratory rate, your blood pressure.
Now, if you think about how important that was during COVID, now apply that into search and rescue, right? Apply that into combat situations. Apply that into surveillance situations, in combat areas. We're even doing work with fish and wildlife reserves and organizations around the world so that they can take the vital signs of animals and livestock without having to sedate them or to put humans in danger or to collect multiple amounts of data at once, as opposed to just sample data. So it just becomes endless when you start to have your own proprietary solutions. I'm going to turn this slide over to our Lead Director, Scott Larson, to talk about what our growth strategy is, because it's a really important component of what we're doing, and it's a very disciplined approach. Scott?
Yeah, thanks, Cam. When we look at our strategy, we kind of break it up into two different categories. One would be organic. Revenue, as Cam mentioned earlier, and Paul, our CFO, is going to get into here in just a few minutes. We continue to grow at 15%, 20%, 25% year- over- year. In fact, as Cam mentioned, it's been more than a few quarters where we've had that type of growth right now. So it is just organic growth that comes through new product development, engineering work, entering into new verticals with some of the new tech that we're coming out, and then deciding joint ventures with other participants in each one of those verticals.
The second way is designed to move the needle a little bit more, a little bit further, and a little bit faster, and that'd be through larger partnerships, looking at different entities in different verticals. Maybe we'll come back and talk about that in a couple of minutes. Looking at larger technical solutions and software and going into things like Ukraine that Cam talked about, and bringing in some new products into that. Then looking essentially through larger joint ventures, engineering work with other industry leaders. We think that there's a number of those initiatives that we've been working on for the last five or six months. These are longer-term, long sales lead items that just take a lot of effort to move through the pipe. But broadly, our growth strategy here at Draganfly is to keep getting the singles and the doubles, if you will.
Keep growing at the 15%-20%, keep growing the core of the business. That is the foundation of the type of work we have been doing since the company started in the late 90s. Secondly, look to layer things on top of that really have the ability to take Draganfly to different levels, different sectors, different countries as well. Those are the two different things that together make up the high level strategy and the path that we are on.
Yeah. I think that there certainly seems to be plenty of M&A opportunity out there, but we are really selective around that. I think Scott has done a great job of characterizing this as growth through partnerships. With the valuations in the industry not being where they could be or where we potentially believe they will be, we are very fortunate to be in a position to rely on organic growth. That is the growth that we want to focus on and demonstrate to. Much of that has been, as Scott likes to put it, singles and doubles that we have been hitting and continuously hitting, and to do that because we have been building up our capacity.
Now, there are a number of real, what we will call needle-moving opportunities that we are well down the path of, and some of those we will be able to talk more about as quarters unfold. I think some of the work that we have been doing in different parts of the world represent those very large opportunities for us. Both feet on the ground, we feel it is really important that we demonstrate good product development, good customer growth, good credible customers Q- over- Q. That is where we believe that there is sustainability. The M&A is great. Integrations are tricky, as we all know. Silos of M&A is not going to necessarily build something that is a sustainable platform. That said, we have got some interesting conversations going on, and we look forward to making some of those right moves. Just to hit some operational highlights from the last quarter.
I think this last quarter really for us could be—despite our record revenue of this last quarter, we were really focused the last number of quarters, and we started to see some of the results of it, in this last quarter in terms of product. We do not go out and build anything that is not being demanded by customers, right? That we have not been doing everything from A/B testing to working directly with customers, knowing that we have got sales for the products that we are building out. In this last quarter, we released three new products. We released the Draganfly Heavy Lift drone. Keep in mind, in Q1, we also released a brand new product, the Draganfly Medical Response Drone. The Draganfly Heavy Lift drone is a versatile industry multi-rotor unmanned aerial vehicle that can be flown autonomously or manually, or semi-autonomously.
It has a capacity of 67 lbs, which as you can see by the size of the box there, is massive. I see a lot of these at a CAD 250,000 drones out there, and they're bragging about capacities of 20 lbs and their VTOLs, and their big fixed wings. I am just like, I do not understand the economics of some of those. Not that they do not exist, and I am not disparaging them, but this thing is a real powerhouse, and I really want to throw it to our engineering team.
They pushed back on me for a couple of quarters, having this thing released, and I was like, "Come on, get it out there." The market is hot for this type of product, whether it is an industrial lift type of situation or whether it is a delivery situation, whether that is going to be by fixed routes or by specific situations that are needed to deliver something of about a 70-lb capacity. We have seen incredible demand from this product. Q3 and Q4, in my mind, this is just my opinion, is we have better visibility on our numbers now than we ever had our old existing line and our services. We have these new products now that are coming to market that are tested by customers. We have demand, we have orders. We are really able to start to see that Q3, Q4, and Q1 visibility.
It is being driven by products like this. I will caveat that by saying that we are not a product-driven company. We are a platform and we are a solutions-driven company. Each one of these things, while it is designed and is being sold as an individual product, really fits into a bigger solution. If we think of our overall agricultural strategy, if we think overall of our delivery strategy, if we think overall of our mapping and survey strategy and how these payloads fit together and why we are building these drones and these orders, it is because we know that we have solutions. Not necessarily these products, right? Products are great, but you sell them, and then you got to sell them again.
When you sell an entire solution to a company and you are servicing long-term, multi-year contracts, you can do it because you have a strategic differentiator that is built into your sensors and into your software. They are great products. They are world-class. Actually fit a much bigger solution for our customers that, doing what we call opportunities, multiple opportunities that are coming. The second product that we released here was the Commander 3 XL. This is the smallest drone that we have produced that would be sold as a product. We have produced extremely small drones, but those were specialized orders for specialized customers. This is something that is really the typical drone size that you see out. We refer to it as a Swiss blade of Drones. This is something that can fit multiple payloads. It is incredibly strong.
This thing can lift over 23 lbs, and it is a small drone, right? If you think about needing to drop things like chainsaws into fire areas or being able to carry payloads into service areas, or being able to utilize quite large sensors for missions that were typically referred to like CAD 50,000 and CAD 60,000 drones, this little unit is able to do it. It breaks down and fits into a package about this big. Those arms. Plain and utilitarian here, for a very good reason. The initial product orders coming in this are looking really strong. The testing that were coming back, the feedback that we are getting is just like, finally, it is something that is like, this takes no brains to run. It is brain damageless. It loads your payloads, and it works, and it works every single time. It is multi-weather toughened as well.
We are really excited about the utility of this particular product. Again, we have never really built a product that is down in this price zone before. We just could not help ourselves. We definitely have. Be used in a commercial. The other product that is the actual long-range LiDAR. Again, think about the. They are building airframes. We are building airframes that are part of a solution, and part of that solution is the actual sensor. What you will see, got generally U.S.-made LiDARs and some European LiDAR systems that have a price point and a quality that is very high. Then you have a Chinese [audio distortion] . In some cases, even better. Not necessarily overall, but the price difference is just amazing. Like 60%. We have done some reselling of both American and offshore systems to our customers.
Over the past year and a half, we saw a very strong sentiment moving away from, for the same reasons that most of the industry was moving away from offshore drones. It is all about security. We did see that there was this gap in the market from a price standpoint and a quality standpoint, and some feature standpoint, to be able to introduce a LiDAR system that was priced below the existing market, still above where the Chinese market was, but it had the North American quality, access, customer service, et cetera, that we can provide. What you are seeing there on your screen on the right-hand side is available. This is a highly sensitive system. This system can be flown on low-flying aircraft, fixed wing, can be flown on helicopter. It can actually even be put on cars or in a backpack. It is highly versatile.
Really nicely on the point cloud. We have got great demand on this thing. These units right now, these are a couple hundred thousand dollar units. It does to really be moving the needle. We are excited about the multi-millions of dollars of revenue that we think just this product line will be generating for us. We had tons in terms of developing out this product and really got it to market in record time. I really want to throw it out to the engineers and the product development team here. It is an amazing product and such. Not only that, the AI and the software that part of our services, specific capabilities that other services cannot provide. There is certain data out of this that we can pull and generate that is very proprietary to what Draganfly can do for its customers.
Again, we want to be able to provide value-added systems that differentiate us from other drone organizations in the market today. The other operational highlight for us, in Q1, we announced going and working with Revived Soldiers Ukraine, an incredible organization doing humanitarian work in Ukraine. We announced orders with them. We started delivering our m edical response drones, our search and rescue drones, and our situational awareness drones into there. We have units kind of going on every maybe three weeks, we have more units that are going into theater over there. We are learning so much from it. Almost every shipment that has gone in has had some sort of upgrade, whether it is software or optics. It is just amazing what these drones are doing now and the experience that we are gaining, not just in the delivery market, but also in the military market as well.
The other thing that was really exciting in terms of Q2 for us was the trip that a number of us made over to Ukraine to Kyiv, met with officials from all types of different levels of government over there. We are embarking on providing a solution into the area. We have unbelievable interest from around the world on this, but in particular, our focus right now is in Ukraine. For every day of war, there is 30 days of mine detection and removal. Estimates are between as low as 20 and as high as 40 years in order to demine just Ukraine. The market potential for this, unfortunately, is absolutely huge. The solution that we have designed, and because we do, is something that we have just not seen that is comparable out there in the market.
We have terrific partners in the region and more and more partners coming on that we are being introduced to all the time. We expect some pretty cool announcements out of this theater and other theaters for this particular product- line and service- line. I just cannot stress enough that, again, this was driven by a customer. This is one of those needle-moving opportunities. It just does not add 15% or 20% per quarter type of thing to the numbers, but really have the opportunity to double and triple the size of your organization. Again, it is proprietary type services and products that we are bringing to the table. So much about the people that we have on board and the people that we get to work with. I killed you all, and I know you all wanted to get the most important stuff.
At this point, I am going to turn it over to Paul Sun. Paul?
Yes. Thanks very much, Cam. Thanks again to all our shareholders and followers for taking time out of the day to listen in. What you see here is three tables. We'll give you a quick snapshot of Q2. Looking at the income statement on the left here, as Cam mentioned, revenue for the second quarter was up 19.6% to CAD 2.37 million, up from CAD 1.9 million in the second quarter of last year, 2021. Second quarter revenue comprised of CAD 1.53 million from product sales, with CAD 837,000 coming from drone services. Our gross profit increased by CAD 285,000 or 39.1% this quarter over the same period last year. Gross margin as a percentage of revenues was 42.8% this quarter versus 36.8% in Q2 of last year. This was a result of more sales coming from higher margin products versus those sold in Q2 of last year.
The total comprehensive income for the quarter was CAD 640,000 compared to a loss of CAD 8.1 million in the same quarter last year. For those that have been following us for a while, you recall that there is an accounting treatment based on Regulation A financing that we did back in 2021, where there's a non-cash change in fair value from derivatives that are included in these numbers. In this quarter, there is a non-cash gain of just over CAD 6 million from the derivative liability, so the comprehensive loss would have been CAD 5.45 million. X-ing out that non-cash change in fair value of derivative liability of CAD 4.8 million from, or comparing it to the liability of CAD 4.8 million from Q2 2021, the comprehensive loss would have been CAD 3.3 million.
The year-over-year increase in the loss was mainly attributed to an increase in insurance costs, office and miscellaneous expenses, and professional expenses. Following that, the loss per share would be approximately CAD 0.16 per share versus the reported CAD 0.02. Or the CAD 0.16 versus the reported CAD 0.02. Going to the middle table on the balance sheet, you see the total assets decreased from CAD 42.1 million to CAD 32.8 million from the year-end, which is largely due to the deployment of cash and the reduction of prepays. The working capital surplus as of June 30th, 2022, of CAD 22.2 million would've been a surplus of CAD 22.9 million, and shareholders' equity would be CAD 30.9 million versus the CAD 30.2 million shown here if we X'ed out that non-cash fair value of derivative liability of CAD 696,000.
You see that we continue to have minimal debt, and our company's cash balance as at June 30th was CAD 16.2 million compared to CAD 23.1 million as at December of 2021. Finally, looking at the table on the right, since we spoke about year-over-year changes on the left side of the table with the income statement here, we'll focus on quarter-over-quarter changes between this quarter, Q2 2022, and Q1 of 2022. Revenue for this quarter again was CAD 2.37 million. That increased by 16% compared to CAD 2.04 million for Q1 of this year due to stronger product sales. Gross margin percentage for Q2 increased to 42.8% compared to 39.9% in Q1 of this year. The increase is due to the sales mix of the products that we sold.
Operating expenses for Q2 increased 16.2% from Q1 of this year, in part due to higher professional fees and wages as the company is scaling and growing. Finally, total comprehensive loss for Q2 was CAD 640,000. Sorry, total comprehensive income was CAD 640,000 compared to a loss of CAD 6.2 million in Q1. Again, you know that the results include a non-cash change in fair value of derivative liability. This quarter was CAD 6.09 million. So X-ing that out, we have a comprehensive loss of CAD 5.45 million compared to what we saw in Q1 of CAD 5.06 million. So quite comparative quarter-over-quarter. With that, I'll pass it back to Cam.
Thanks. As always. A couple of other things before we get to the Q&A that I think are in terms of our governance. This last quarter, we were thrilled to announce that John Mitnick is now our Chairman of the Board. My role has moved to continue to be as [audio distortion] well, but I've relinquished the chairman position happily to Mr. John Mitnick. The board since 2020. John is, you can see by his resume or bio on the left, has got an incredible amount of experience. General Counsel for all of Homeland Security, had over 2,500 attorneys report to him at that time. John is also a former General Counsel at Raytheon, which is, as we all know, a very significant multi-billion dollar military contractor in this space.
John just brings a tremendous amount of not just legal and governance experience, but industry exposure, contacts, and really provides us a tremendous amount of insight and reach. So we're really, really proud and happy and thankful that John's joined us, not just as a Board Member, but he's actually taken on the chairmanship role, along with the other excellent board members that we have. Paul Mullen, who was our VP and headed up our Vital Intelligence unit, which has been very successful for us, and we're really excited about some of the upcoming things there, is now our Chief Operating Officer. This is the first time we've now had a Chief Operating Officer as our business continues to mature and evolve. Really thanks to Paul, he's been able to bring our last four products, including VI, so I guess our last five products, online very successfully.
Really is bringing a level of that maturity in recruiting and everything else to the business right now and really streamlining our operations. A big focus not just as product, but as also has been capacity. So, us building out that capacity to meet the demand that we have and continue our growth and accelerate our growth in through next year is really a key part of what we're doing. So thanks, Paul, for that. Thrilled also to announce Deborah Greenberg has come on board as our Chief Legal Officer. Deborah is incredible and was such an exciting hire for me for the very simple fact that Deborah is much more than a lawyer. She has an IT background. She has a marketing background. She's an incredibly strong negotiator. Totally level-headed.
Jumped right in and was able to really add incredible perspective to a number of the negotiations that we have going on, from a vendor perspective, from contract, and from a customer perspective, and just value adds in everything that we're doing. While a Chief Legal Officer may be viewed as somebody that really helps strengthen our governance, which represents a lot of the type of growth that we have to have in order to onboard them. But the other depth that's improving our business development and our closing that sales cycle as well. Welcome again, Deborah, and thanks so much for being here. Everybody can see by her bio there just why we were so lucky to get Deborah on board with us. We're not sure, but we're not going to question it. We're just going to roll with it. Thanks, Deborah.
In thinking about, before we get to Q&A, and in thinking about Draganfly, there's really three things that we focus on is technology, is traction, and is team. Organization that's focused on solutions for customers. That's really highlighted in that middle section there. We're hitting it every quarter. We're doing what we're saying that we've done. We've hit our numbers, and we're doing it in a way we're not over-promising. It's so tempting to talk about the massive numbers in the organization, but we've really stuck to the discipline of making sure our capacity is in place, making sure that our infrastructure and our admin and our ERPs and all the rest of it can handle what we see coming through this pipeline, while we're still managing to introduce new product lines and continue that kind of 20% just consistent organic growth.
We think it's going to pay dividends for us. That traction to us, the type of traction. Also, we are a technology-focused organization. We like to build new tech, but we like to do it in the focus of a customer. We've got a strong patent portfolio. We've got hundreds of pieces of [audio distortion] A lot of trade secrets, a lot of things that we do with and for our customers that really make it sticky, and we think are going to continue to put us in a position of that, once you start working with Draganfly. [audio distortion] There are alternatives. We really like the tech [audio distortion]. Our technology. Then we've got a team. If you look at our Board, it's a very seasoned Board. It gives us incredible reach, incredible depth. [audio distortion] in the world economics and politics that we're faced with right now.
If we look at our executive team, I'd compare it against any executive team in the industry, not that there's not a lot of great ones out there, but this is a team that's really got the experience, both in terms of the drone industry, but also the entrepreneurial industry, the engineering space, the legal space, and it's really, really gelling. I'm more confident than ever in our Q3, Q4 numbers already. It's just to have that visibility rather than to have beginning of the queue, right out of the gate and worry about where and how we're going to get there. It's just such a great feeling to see with[audio distortion] o n that front, I'm going to turn it over to Scott, and we're going to hit some Q&A.
I'm going to do my best to not jump in, but there's already some Q&A here I'm just dying to answer, but I'll let Scott and Rolly kind of take it from here for a little bit. Scott, Rolly?
Scott, do you want to kick off then? Go ahead.
Yeah, I was just going to say thanks for that. There's a number of questions that have come in online. We're doing our best to work our way through those. There was a number of questions that came in prior to the call. We'll work our way through as many of these as we can, and then also get to some of the ones that have been entered in and asked online. Cam, delivery is a hot topic in drones. We've talked a little about this already, but what do you think Draganfly's role in drone deliveries is going to look like both in the near- and the far- term?
Yeah, delivery is a big topic, and if you're going to be in the drone space to be a meaningful player, you're going to have to be in the delivery [audio distortion]. Doing with our hardware on the hardware side, the introduction of the h eavy lift drone and the medium lift drone, which is our m edical response drone. Even if we look at the construct of the Commander 3 XL, the 3 XL, sorry, they all have delivery components to it. You can look to the future for us in some VTOL work coming up and some fixed-wing work. Some of the work that we've done over in the Ukraine in the last quarter has been tremendous in terms of our winching technology, our AI, in order to hover and drop.
In some cases, that's not necessarily as it relates to consumer goods, but certainly in the theater that that is, that's really important for making sure that we get humanitarian packages and such right into the exact spots and areas that we want to. It's probably amongst, well certainly it's in the top three areas of interest that are continuously inbound on the solution side. Here's the thing about delivery, is we don't have people coming to us saying, "Hey, we want a delivery drone." What we have is we have organizations coming to us saying, "We want a delivery [audio distortion]. We need FAA consulting.
We need a particular type of drone that does X, Y, and Z." I would also love to point to the work that we're doing with Cleburne in Texas, and the work that we're doing there in terms of medical delivery, emergency response to will have a big impact in delivery. We're in revenue in those particular markets right now. I think we're well-positioned. We're not afraid to work with partners. There's some other people that have some fantastic technology in the space that we think is leading edge. We're also always building our own in there as well, but a big component of our business going forward.
Yeah. Another quick question, Cam. I'll send this one back to you as well, and then there's a few more that I'll answer on. Most drone stock seems to be flat this year. Do you think we might start to see consolidation in the industry? Is Draganfly a buyer?
Yeah, 100% Draganfly's a buyer. For sure. I think we're pretty selective, and we've got a very strong strategy as opposed, in particular, what we're looking for and how we'd like to do that. We will see consolidation in the space. We just saw news this week of another big VC-backed, CAD 100 million, maybe CAD 75 million investment just for business, people don't recognize that it's all glory and exciting, and it's just such a big opportunity, but it is incredibly particular and it's so much more than just building an airframe, right? It's the rules and the regulations and the airframes and the software. We think that there's going to be some opportunity out there. We're pretty focused on revenue that are in the revenue space. There's a lot of really cool tech out there, a lot of great ideas.
But maybe look to some of that on the services side as a buyer.
I think there's another question here that kind of dovetails with that a little bit about what joint ventures did Draganfly enter into, which ones are on the horizon, and what kind of revenue has been generated, and what kind of revenue do we think might come out of some of these joint ventures? I think, without getting too specific into giving guidance and getting ahead of things that haven't quite been announced but we hope are getting to that stage. We had a Board meeting earlier today, and we talked a little bit about this. In the last number of months, there's been inbound inquiries from international opportunities that have come into Draganfly from five or six different countries around the world, in addition to some of the ones that we've already talked about and some of the ones that have been mentioned in the past.
There is significant inbound inquiries, interest, requests for information, and answering to RFPs and so forth, that have come into us from Europe, Asia for sure, South Asia, different parts of South America. There's just a lot of work in that, and each one of those is joint ventures working with large, in some case, Fortune 50 type companies to provide both hardware as well as middle stream type, the applications and integration with drones and other technologies to come up with some of the downstream applications, the information that Cam was talking about earlier. I don't think we quite want to get into giving guidance to that, but the point is that there's a lot of it. These are all long lead type programs, difficult customers, and kind of far parts of the world in certain cases. But there's been a lot of that has come in.
In fact, more than I think we've probably seen in any quarter in the history of the company. I don't think that's a bit of an exaggeration, but there's been a lot of that has come in. We'll continue to report on those as we can, as they become material, as contracts and so forth are announced, and we're working hard on that, and all of us are. Cam, talk a little bit about DDL, how that contract is going as much as we can without getting ahead of ourselves. But what's the status of it? What does it look like? Any updates there?
Yeah. Sounds great. So, multiple industrial. Majority of the tooling is complete. There is still some work to do there and in stock that we are managing through and such. So I think we are probably close to seeing revenue start to pop. Still somewhat hopeful for Q4, but that was a bit of a stretch for us. But we are comfortable that the Q1 should be producing revenue there. They have had tremendous inbound on the product. I think just one of the websites alone has over 6 million inquiries on it for the [Cozmo AI Hottie drone] we are building the companion to. So we feel other than some of the timing and some[audio distortion] and they have done what these pretty much ready to go. It is an indoor drone. It is a highly specialized product.
I can say that has led to some other inquiries from other really big players in the industry around some indoor and security drones, some potential military use drones, things like that. So, it has garnered us some fringe benefits other than just the size of order it is for us.
Okay, listen. It is 50 minutes since we started. We try to keep these calls to 45 minutes if possible. We have answered most of the larger questions. There is a number of questions here that have come in that are pretty specific in terms of line items on the financials, and I think we would like to take some of those offline. If you want to call the Investor Relations or talk to Rolly afterwards or email in and say, "Hey, can I get a little more color on this?" Or, "Is there an explanation?" I think we are happy to do that as long as we are not crossing any lines here. But, with that said, it is 50 minutes since we started. I think we want to start to wrap this up call. Cam, why don't you go ahead and wind us down, and then we can go from there.
I would love to answer, so don't be afraid to hit Rolly up, and we will make sure we answer every single one of them as specifically as we can. It is technology, it is traction, and it is team. And those are the things that we are going to continue to focus on. We have hit our numbers, all our results. We really appreciate your support. We are going to continue to do that. We are fanatical about being number one or number two over the coming years in this space, which is a multi-billion dollar space, and we appreciate your trust. Thank you.